The bull market is about to enter its seventh year and it seems like a lot of investors are just itching to make a change to their portfolio or investing habits. Giving in to the feeling of the seven-year itch is bad news for most investors because they haven’t yet had a six-year rally. They didn’t see this coming — no one did — and were so shaken by the implosion of the financial crisis that they weren’t in on this bull run at the beginning. Now many people are looking at a reason to get out before the party is over. Depending on who you talk with, however, the party is far from over. Adam Grimes, chief investment officer at Waverly Advisors, said recently on my radio show that taking a long-term technical view suggests that the market could be less than halfway into an uptrend, and that while he expects to see downturns and corrections, they shouldn’t scare anyone. Meanwhile, it’s easy to find people who are saying the scary stuff, talking about bubbles, crashes and worse. Last week, I spoke to a group of mostly retirees, and the fear was palpable; the concerns, however, were shared by younger investors who are just as worried about the future, just with different concerns about timing and longevity risk (because they have more time to recover from any downturn). For average investors, the reminder that the bull market is another year older is a reason to reconsider their fears. With that in mind, here are some of the things I heard as to why investors might make portfolio alterations now, and why most of them would be bad motivations to make any significant moves: 1. ‘It can’t go up forever,’ or ‘We are overdue for a downturn or a correction.’ Technically, it can. In fact, the hope and expectation of every investor is that the market will be higher at the end of their lifetime than at the beginning of it. Bill Nygren, co-manager of the Oakmark Fund, reminded me recently that for well over half of his career, he has been investing when the market was at all-time highs, and that he hoped that would continue for the rest of his career. That’s a very long-term view, however. In the short run, there’s no question that every rally comes to an end, but there is no expiration date or shelf life to a bull market. If you have concrete reasons — beyond the length of the run — to make a change, go fir it, but don’t let the length of the rally determine anything. After all, in 2009, when the market was about to turn around, average investors were not rushing into the market under the equally flawed logic of “It can’t get much worse.” 2. ‘Because the bull run has been long, any decline is going to be big, too.’ There is nothing that says bull and bear runs need to be balanced in any way. In fact, the market historically tends to rise two years plus for every one it’s down. None of that is written in stone, however. Even the folks calling for a significant market pullback right now are talking about how much things are likely to fall before the market is “buyable.” They’re nervous and worried, but they believe that a downturn will create new opportunities rather than thinking a decline will be a long, nuclear winter for the market. 3. ‘The Federal Reserve is serious about raising rates now, and that’s going to end the rally.’ This has been an overhang on the bull market run for at least 16 months now, and there is no denying that the Fed ultimately will hike rates. There’s a big question about when that will happen — whether it will be this year at all — and meanwhile the market has continued moving up. Furthermore, as rate hikes look more and more real, many experts believe their impact has already been priced in to the action, meaning that it will take a few rate hikes — and months longer — before an increase really has an impact. 4. ‘The government will screw this up.’ No matter your politics, there is no denying that the chuckleheads in Washington can create problems. But if they didn’t derail the bull market with various budget controversies, the fiscal cliff and more, then it’s hard to see the government taking any action that’s a real catalyst for a widespread market downturn. The government will make headlines and its actions will seem threatening, but they won’t rain this game. 5. ‘The market is overpriced.’ Record highs don’t mean the market is necessarily overpriced, but there are some metrics which would agree with this statement now. The problem is that the person who is not investing now because valuations are high is not necessarily going to feel better when there is a correction or downturn — and those events are coming, they haven’t been repealed — so that they buy in once things are priced more like a bargain. This is a good reason not to invest if it means you are keeping your powder dry, or even taking profits in anticipation of putting the cash back to work at a better price, but the people who have been crying about an overpriced market for the last two-plus years have hurt themselves by this kind of logic. 6. ‘You can’t lose money in cash, so I will wait until the next downturn passes.’ You can lose purchasing power, however. Anyone who has been sitting in cash for the last six years — because they didn’t see the rally coming and haven’t trusted it when it arrived — has nothing to be particularly proud of. In his annual letter to shareholders this year, the legendary Warren Buffett noted that investments in cash, cash-equivalents and currencies are more risky long-term than investments in stocks. That’s not to suggest that people invest cash they can’t afford to put at risk; there’s nothing wrong with taking risk off the table, especially at a time when the market makes you nervous, but if you are waiting for the “perfect” time to be in the market — when you are comfortable, confident and worry-free — you’re never going to find it. Chuck Jaffe